What cultural factors affect international business activities. Cultural Factors Affecting International Business 2019-01-22

Sociocultural Factors That Affect Marketing

In some countries, business professionals shake hands as a way of showing business etiquette. Explain quality standards as they relate to product development and packaging. Participants in the performance events should be aware the national association reserves the right to record any performance for use in study or training materials. Describe how language, culture, media availability, and regulations affect international advertising and marketing. Many source suppliers from foreign countries and still more compete against products or services that originate abroad.

Cultural Issues Affecting International Trade/Culture Applied

Other cultures, notably the Japanese and the Chinese, stress team negotiation and consensus decision making. Because, it is claimed, that the essence of the deal is the relationship between the parties. This article discusses this framework and how to apply it. Reed Hall, Understanding Cultural Difference, Yarmouth, Maine: Intercultural Press, 1990. All of these factors are able to affect our attitudes, our opinions and our interests, thereby directly impacting product sales and services by businesses and revenues earned. Why it is important to know cultural factors affecting international business Variation in cultural factors should be considered by the management of an international business in order to succeed.

The Effects of Socio

The Growth of International Business The prevalence of international business has increased significantly during the last part of the twentieth century, thanks to the liberalization of trade and investment and the development of technology. When Chinese greet someone they do not look straight in the eye, but lower their eyes slightly. The Confucian value of endurance has a profound impact on the business process. Applying this framework in your international business negotiations may enable you to understand your counterpart better and to anticipate possible misunderstandings. Businesses that go multinational have to deal with lots of issues that smaller businesses don't have to deal with.

Social and cultural factors affecting business

While entering a negotiation session, it is crucial that international businessmen know the negotiation attitude of the other party. The authors examine antecedents of consumer innovativeness in a cross-national context. List sources of capital for international, transnational, multinational, and global companies. Pepsi has to value and indulge in all the festivals and relate itself to the market. Risk taking: High or low? Handshaking has to be very lightly and followed by exchanging of business cards, preferably with English text on one side and Chinese on another.

Factors That Affect a Multinational Corporation

The latter may use circumlocutions, figurative forms of speech, facial expressions, gestures and other kinds of body language. For example, in a country where equality is a widely accepted concept, businesses would try to provide equitable employment opportunities. Identify how the managing functions e. Now, every society, as explained above, constructs its own social environment factors affecting their businesses. Discuss complications involved when speaking, writing, or interpreting a language incorrectly introductions, American jargon. Personal style: Informal or formal? The ten negotiating traits discussed above can be placed on a spectrum or continuum, as illustrated in the chart below. The economy of countries may be industrialized developed , emerging newly industrializing , or less developed third world.

Cultural Factors in Doing Business in China

Probably the most extreme and fascinating of these is Japanese, where characters are double-byte and consist of three different types ranging from the original Chinese characters to the more phonetc varieties — all mixed up to create multiple word spellings and opportunities for search marketers. In the case of team events, all team competitors are expected to actively participate in the performance. Communication both orally and use of body language plays a vital role of enabling a business to know what the basic needs of consumers are. Therefore, business strategies should have room for such fluctuations. The social status is also a relevant factor; an individual from an upper-middle class would spend on luxurious goods, while an individual from a lower income group would buy items required for basic needs. Analyze the global impact of the stock and bond markets. With personalization, consumers can choose from various product attributes and a customized product is assembled based on their preferences.

(PDF) The Cultural Impact on International Marketing Strategy, With a Special Emphasis of Bangladesh Perspective

Group Dynamics This comprehension lens involves the understanding of how individuals from certain cultures interact in groups. The two sets of rules use similar accounting terms, and a lot of the practices are identical. Guanxi or the network and interaction, is vital for business. The Benefits of International Business and the Concept of Comparative Advantage Participation in international business allows countries to take advantage of their comparative advantage. Additionally, changes in the proportion of genders and different racial, religious and ethnic groups within a society may also have a significant impact on the way a company does business.

Legal factors affecting business

The group with the strongest preference for consensus organization was the French. The cultural environment of a foreign nation involves commonly shared beliefs and values, formed by factors such as language, religion, geographic location, government, history, and education. Describe the decision-making process, opportunity costs, and scarcity as they relate to international business situations. Due to this shifting behaviour, businesses that have invested in fitness and organic food have seen a massive growth. The difference in approach may explain why certain Asian negotiators, whose negotiating goal is often the creation of a relationship, tend to give more time and effort to negotiation preliminaries, while North Americans often want to rush through this first phase of deal making.

Sociocultural Factors That Affect Marketing

Time Orientation The concept of time orientation refers to the way in which a society values, executes and utilizes time. Describe different organizational structures that a company might use in the international environment. Let us examine some examples of American executives interacting with Chinese executives to illustrate how a few of these comprehension lenses impact business. Cross-cultural differences have time and time again been identified as the most significant impediment to successful international ventures and projects. Short-term wastefulness in a supply chain, for example, is despised because thrift is a significant virtue, but professional development training that will lead to long-term corporate growth may see lavish expenditures. Knowing means that reasonable expectations for the deliverable can be set. My own definition is that culture is our collective experience as a society, and its impact on our reaction and decision-making relative to every-day facts and circumstances.